Trump Media & Technology Group Corp.DJT

Trump Media & Technology Group Corp. Fair Value Disclosure

10-KFiled Feb 27, 20263 min read
NOTE 4 - FAIR VALUE MEASUREMENT

Fair value is defined as an exit price, representing the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. We use a three-tier fair value hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value:

Level 1. Quoted prices (unadjusted) in active markets for identical assets or liabilities.

Level 2. Significant other inputs that are directly or indirectly observable in the marketplace.

Level 3. Significant unobservable inputs which are supported by little or no market activity.

The categorization of an asset or liability within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The valuation techniques used by us when measuring fair value maximize the use of observable inputs and minimize the use of unobservable inputs.

   
As of December 31, 2025
  
   
Quoted
prices
in active
markets for
identical
assets
(Level 1)
    
Significant
other
observable
inputs
(Level 2)
    
Significant
unobservable
inputs
(Level 3)
  
Assets
                  
Money market funds(1)
  
$
101,800.4
    
$
-
    
$
-
  
Repurchase agreements
    
-
      
305,053.3
      
-
  
Exchange traded funds(2)
    
714,082.4
      
-
      
-
  
Purchased option assets(2)
    
7,986.7
      
-
      
-
  
Convertible note receivable
    
-
      
-
      
149,420.4
  
Digital assets
    
904,370.6
      
-
      
-
  
Digital assets pledged
    
-
      
175,300.4
      
-
  
Total assets measured at fair value
  
$
1,728,240.1
    
$
480,353.7
    
$
149,420.4
  

Liabilities
                  
Options premium liabilities(3)
  
$
21,433.9
    
$
-
    
$
-
  
Convertible notes
    
-
      
-
      
945,197.0
  
Total liabilities measured at fair value
  
$
21,433.9
    
$
-
    
$
945,197.0
  
   
As of December 31, 2024
  
   
Quoted
prices in
active
markets for
identical
assets
(Level 1)
    
Significant
other
observable
inputs
(Level 2)
    
Significant
unobservable
inputs
(Level 3)
  
                   
Money market funds(1)
  
$
160,084.0
    
$
-
    
$
-
  
Repurchase agreements
    
-
      
606,547.3
      
-
  
Total assets measured at fair value
  
$
160,084.0
    
$
606,547.3
    
$
 

(1)  Money market funds are reflected in cash, cash equivalents, and restricted cash in the consolidated balance sheets.
(2)  Reflected in equity securities in the consolidated balance sheets.
(3)  Reflected in accounts payable and accrued expenses in the consolidated balance sheets.

The fair value of our money market funds, repurchase agreements, equity securities, digital assets, option assets, and option premium liabilities are classified within Level 1, because we use quoted market prices to determine their fair value. Exchange traded funds are valued based on the last trade price on the primary exchange on which they are traded, and options are valued based on the mean of the last bid and ask price. Digital assets are valued using the quoted (unadjusted) closing price of bitcoin and Cronos in U.S. dollars on the active exchange that we have determined is its principal market at 4:00 PM Eastern on December 31, 2025. We have not realized any material losses related to these securities.

We also estimate the fair value of cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses, and accrued compensation and employee benefits. The Company considers the carrying value of these instruments in the Consolidated Financial Statements to approximate fair value due to their short maturities.
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About Fair Value Disclosures

Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.

Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.

Other Available Disclosures

Income TaxesEarnings Per SharePP&EGoodwill & IntangiblesLeasesSegmentsCommitmentsStock CompensationNew Standards